Question

In: Accounting

The Field, Brown & Snow partnership was begun with investments by the partners as follows: Field,...

The Field, Brown & Snow partnership was begun with investments by the partners as follows: Field, $129,100; Brown, $167,700; and Snow, $154,600. The operations did not go well, and the partners eventually decided to liquidate the partnership, sharing all losses equally. On May 31, after all assets were converted to cash and all creditors were paid, only $46,100 in partnership cash remained.

QS 12-9 Part 2

2. Assume that any partner with a deficit agrees to pay cash to the partnership to cover the deficit. Present the journal entries on May 31 to record (a) the cash receipt from the deficient partner(s) and (b) the final disbursement of cash to the partners.

Record the receipt of cash from the deficient partner(s).

Note: Enter debits before credits.
Transaction General Journal Debit Credit
(a)

Record the disbursement of the remaining cash to the partner(s).

Note: Enter debits before credits.
Transaction General Journal Debit Credit
(b)

Assume that any partner with a deficit is not able to reimburse the partnership. Present journal entries (a) to transfer the deficit of any deficient partners to the other partners and (b) to record the final disbursement of cash to the partners.

Journal entry worksheet

Record the transfer of the deficit of any deficient partner(s) to the other partner(s).

Note: Enter debits before credits.
Transaction General Journal Debit Credit
(a)

Journal entry worksheet

Record the disbursement of the remaining cash to the partner(s).

Note: Enter debits before credits.
Transaction General Journal Debit Credit
(b)

Solutions

Expert Solution

Total Capital contributed partners = $451400 Answer a
Share per partner = $451400 / 3 = $150466.67 Journal entry to record cash receipt from the deficient partner(s)
Transaction Account Title Debit Credit
Partner Name Current Capital Required Capital Excess / (deficit) a Cash $21,367
Field $129,100 $150,467 -$21,367 Field's Capital $21,367
Brown $167,700 $150,467 $17,233
Snow $154,600 $150,467 $4,133 Answer b
Journal entry to record the disbursement of the remaining cash to the partner(s).
Transaction Account Title Debit Credit
b Field'S Capital $22,489
Brown's Capital $22,489
Snow's Capital $22,489
Cash $67,467
Answer a
Journal entry to record the transfer of the deficit of any deficient partner(s) to the other partner(s).
Transaction Account Title Debit Credit
a Brown's Capital $10,684
Snow's Capital $10,683
Field's Capital $21,367
Answer b
Journal entry to record the disbursement of the remaining cash to the partner(s).
Transaction Account Title Debit Credit
b Field'S Capital $15,367
Brown's Capital $15,367
Snow's Capital $15,367
Cash $46,100

ekkarill92 answered 9 months ago
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